Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Please help me please i will give good rating Raja Bhd is a public company, and its functional currency is the Ringgit Malaysia (RM). Recently
Please help me please i will give good rating
Raja Bhd is a public company, and its functional currency is the Ringgit Malaysia (RM). Recently it has purchased a foreign subsidiary, PT Mahkota, whereby the functional currency of the entity is the Rupiah. Raja Bhd purchased 80% of the equity shares of PT Mahkota on 1 October 2021 for 172 million Rupiah. The carrying amount of the net assets of PT Mahkota at that date was 180 million Rupiah. The fair value of the net assets at that date was 200 million Rupiah. At the year end on 31 December 2021, the goodwill was tested for impairment, and this review indicated that it had been impaired by 3.6 million Rupiah. The exchange rates were as follows: Raja Bhd elected to measure the non-controlling interests in PT Mahkota at fair value at the date of acquisition. The fair value of non-controlling interests in PT Mahkota on 1 October 2021 was 50 million Rupiah. The management of Raja Bhd is unsure of how to account for the goodwill, and so has measured it at the exchange rate at 1 October 2021 in the consolidated financial statements. No adjustment has been made since that date. Required: (i) Calculate the goodwill that should be recognised in the consolidated statement of financial position of Raja Bhd as at 31 December 2021. (ii) Prepare journal entries on the adjustments to be recognised inStep by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started